Customization: Ideal Varieties, Product Uniqueness and Price Competition
We study customization in the Hotelling model with two firms. In addition to providing ideal varieties, the perceived uniqueness of a customized product contributes independently to consumer utility. We show that only when consumer preferences for uniqueness are high customization occurs in equilibrium.
|Date of creation:||31 Jan 2009|
|Date of revision:|
|Publication status:||published in Economics Bulletin 2009|
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- Bernhardt, Dan & Liu, Qihong & Serfes, Konstantinos, 2007. "Product customization," European Economic Review, Elsevier, vol. 51(6), pages 1396-1422, August.
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"Customization with Vertically Differentiated Products,"
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- Alexei Alexandrov, 2006.
1435, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
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- Rajiv Dewan & Bing Jing & Abraham Seidmann, 2003. "Product Customization and Price Competition on the Internet," Management Science, INFORMS, vol. 49(8), pages 1055-1070, August.
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